Wolford AG — Earnings Release 2008

Mar 18, 2008

News Details

Ad-hoc | 18 March 2008 08:30

Wolford AG: Sales and earnings for the first three quarters of 2007/08

Wolford AG / Quarter Results

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Wolford with significant sales growth and disproportionately high earnings
increase

· Sales up 15.9 percent in the first nine months
· Ongoing positive development of earnings
· Wolford boutiques remain key growth drivers
· More optimistic forecast for full year: sales increase to about EUR 157
million, disproportionately high rise in earnings

Bregenz, March 18, 2008

The Wolford Group, which is listed on the Vienna Stock Exchange,
impressively confirmed its success path in the first nine months of this
current fiscal year. Sales rose by 15.9 percent, to EUR 125.0 million, up
from EUR 107.8 million in the first three quarters of the previous year,
whereas EBITDA (operating profit before depreciation, amortization and
impairment), EBIT (operating profit) and the profit from continuing
operations before taxes rose even more steeply than sales. 'Double digit
revenue growth in most key markets and in all strategic distribution
channels and major product segments as well as the sustainable rise in
earnings are convincing proof of the strong market position we have gained
in recent years despite a very competitive business environment', says
Holger Dahmen, CEO of Wolford AG in reviewing the first three quarters of
fiscal 2007/08.

Ongoing positive development of earnings

The earnings performance of the Austrian luxury brand Wolford was even
better than the sales trend. In the first nine months of fiscal 2007/08,
EBITDA rose by 35.2 percent, to EUR15.8 million (Q1-3 2006/07: EUR 11.7
million). EBIT even jumped by 53.4 percent, to EUR 10.7 million (Q1-3
2006/07: EUR 7.0 million). Accordingly, the EBITDA margin increased by 1.8
percentage points to 12.7 percent, whereas the EBIT margin improved in the
same period by 2.1 percentage points to 8.6 percent. In the first nine
months of the 2007/08 fiscal year, profit from continuing operations before
taxes amounted to EUR 9.2 million, an increase of 59.2 percent (Q1-3
2006/07: EUR 5.8 million).

In the third quarter alone, EBIT of the Wolford Group climbed 64.0 percent,
to EUR 5.6 million (Q3 2006/07: EUR 3.4 million), which corresponds to a
third quarter EBIT margin of 11.6 percent (Q3 2006/07: 8.0 percent).

Sound equity capital base

At the reporting date of January 31, 2008, shareholders’ equity was EUR
78.8 million, a rise of 6.8 percent above the year-earlier level. This
brought the equity ratio to 49.7 percent. Profit from continuing operations
before taxes, depreciation, amortization and impairment was EUR 14.3
million at January 31, 2008, thus 36.3 percent higher than in the first
nine months of the 2006/07 fiscal year.

Gratifying sales growth in all main geographic markets

As to market regions, in the first nine months of the fiscal year, the
Wolford Group achieved double-digit growth rates in almost all major
markets. Wolford posted considerable growth in the Netherlands (up 29.0
percent), the United Kingdom (up 26.4 percent in Group currency; 29.6
percent in British pounds), Scandinavia (up 21.1 percent), France (up 16.4
percent), Switzerland (up 15.1 percent in Group currency, 20.4 percent in
Swiss francs), on the company’s domestic market of Austria (up 12.4
percent) and in Italy (up 12.4 percent). Sales were also significantly
expanded in Spain (up 9.2 percent), Germany (up 7.3 percent), and the USA
(up 5.9 percent in Group currency, 16.1 percent in US dollars). Moreover,
Wolford succeeded in considerably boosting sales in the growth regions of
Asia/Oceania (up 52.8 percent) and Central and Eastern Europe (up 37.3
percent).

Double-digit growth in all major product groups

By the end of the first three quarters of 2007/08, Wolford had achieved a
tangible increase in brand sales in every important product group.

Legwear showed growth of 11 percent, while the Ready-to-Wear products which
Wolford has strategically focused on in recent years have gained
increasingly broad acceptance in the market, pushing up sales. Thus sales
continued to develop very promisingly, climbing 26 percent in the first
nine months of fiscal 2007/08. Brand sales in the Lingerie and Accessories
product groups likewise grew at double-digit rates.

Wolford boutiques remain key growth drivers

Wolford’s proprietary stores – boutiques, shop-in-shops and factory outlets
– achieved a 20.5 percent expansion of sales (or 8.8 percent on a
like-for-like basis in Group currency, or 11.9 percent adjusted for
currency effects).

In the first three quarters of 2007/08, the prime movers of revenue
remained Wolford-owned boutiques, whose sales increased by 21.2 percent, as
well as partner-operated boutiques, with which Wolford saw sales growth of
18.4 percent. Overall, the Wolford boutiques (88 Wolford owned boutiques
and 138 partner-operated boutiques as per end of January 2008) registered
sales growth of 20.3 percent in the nine-month reporting period compared to
the first three quarters of the preceding year, thus continuing their major
contribution to total sales revenue.

The other strategic distribution channels – department stores, multi-brand
retailers and factory outlets – also developed very positively, posting
double-digit growth rates despite a, for the most part, extraordinarily
strong comparison period during 2006/07.

Outlook

In the fourth quarter of 2007/08, the Wolford Group will once again focus
on the continuous expansion and qualitative improvement of the monobrand
stores.

Based on the good business performance in the first three quarters, the
Executive Board expects an increase in sales to about EUR 157 million as
well as a disproportionately high rise in earnings for the current 2007/08
fiscal year as a whole.

Sales and earnings data for Q1-3 2007/08 (May 1, 2007 to January 31, 2008)

in TEUR Q1-2 Q3 Q1-3
ended Oct. 31, 2007 ended Jan. 31, 2008 Jan. 31, 2008 Jan. 31, 2007 change
in %
Sales 76,507 48,446 124,953 107,791 15.92%
EBITDA 8,415 7,413 15,828 11,707 35.20%
EBITDA margin based on sales 11.00% 15.30% 12.67% 10.86%
EBIT (operating profit) 5,096 5,630 10,726 6,994 53.36%
EBIT margin based on sales 6.66% 11.62% 8.58% 6.49%
Profit from continuing operations before taxes 4,007 5,220 9,227 5,797
59.16%
Net profit for the period 3,614 3,130 6,744 5,866 14.97%
Earnings per share in EUR 0.74 0.64 1.38 1.20 14.78%
Profit from continuing operations before taxes and DA&Im*) 7,326 7,004
14,330 10,510 36.34%
Capital expenditure excluding financial assets 4,388 2,101 6,489 5,690
14.04%
Net debt 20,580 17,877 15.12%
Dept/equity ratio 26.13% 24.24%
Shareholders' equity 78,756 73,739 6.80%
Average staff count for period (in full-time equivalents) 1,655 1,457
13.59%

Further information can be found at www.wolford.com / Business World /
Investor Relations / Reports Sales and Earnings.
Definitions of financial indicators are contained in the latest annual
report for the 2006/07 fiscal year.
* DA&Im represents depreciation, amortization and impairment

Contacts: Holger Dahmen, Chief Executive Officer
Peter Simma, Deputy Chief Executive Officer

Investor@wolford.com
Wolford AG, Wolfordstraße 1, A-6901 Bregenz, Austria
+43 (0) 5574/690-0
www.wolford.com
18.03.2008 Financial News transmitted by DGAP

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Language: English
Issuer: Wolford AG
Wolfordstraße 1
6901 Bregenz
Österreich
Phone: +43/5574/6907434
Fax: +43/5574/6907440
E-mail: investor@wolford.com
Internet: www.wolford.com
ISIN: AT0000834007
WKN: 83400
Indices: ATX
Listed: Freiverkehr in Berlin, München, Stuttgart; Open Market in
Frankfurt; Foreign Exchange(s) Wien

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